Madison Avenue Keeping Watch On MarketWatch
The Times reported yesterday that CBS MarketWatch hoped to auction itself off for as much as $400 million, based on statements of unnamed executives. Possible buyers listed by the Times include Internet company Yahoo!, Wall Street Journal owner Dow Jones & Co., the CBS unit of Viacom, and the Financial Times Group of Pearson. Viacom currently has a 22.4 percent stake in MarketWatch. MarketWatch declined to comment on the report.
"MarketWatch would be a great asset to any of those properties," said Patrick Benson, vice president, associate interactive media director at Deutsch, New York, a unit of the Interpublic Group of Cos. "It has great content. Very unique content." Benson added that a Dow Jones-MarketWatch alliance clearly makes sense because such an acquisition could give Dow Jones--which has more than 700,000 paid subscribers to the online Journal--a new well of free content.
MarketWatch contains a mix of free and paid content; the company's second-quarter report showed advertising revenues of $8 million, subscription revenues of about half a million dollars, and licensing fees of $11.7 million. A Dow Jones representative declined to comment on any possible acquisition of MarketWatch.
But a deal with Yahoo! might not be as natural a fit, said Benson, because MarketWatch's audience appears to be more sophisticated than Yahoo!'s. Sixty-nine percent of MarketWatch's audience has a college degree, and 55 percent have household incomes of at least $75,000, according to a media kit on the company's Web site.
On the other hand, said Alan Schanzer--managing partner of The Digital Edge, New York, the interactive arm of WPP Group's Mediaedge:cia--MarketWatch could join Yahoo! without losing its core audience. "Yahoo! could keep MarketWatch as an independent property that reaches the slightly more sophisticated user," Schanzer said.
Sarah Fay, president of the digital marketing agency Carat Interactive, said she sees a MarketWatch-Yahoo! merger as potentially allowing marketers to advertise on MarketWatch as part of a Yahoo! package. Yahoo! did not return a telephone call by press time.
If CBS buys the site, marketers might be able to better integrate ads on MarketWatch with other CBS properties, added Schanzer. Ultimately, said Fay, MarketWatch will be more appealing to advertisers if a new owner can increase traffic. "Probably," she said, "it would be stronger as part of a bigger entity." MarketWatch had about 5.7 million unique users in September, while Yahoo! Finance had about 9.5 million, according to Nielsen//Net Ratings. "If you're linked to a bigger property," said Fay, "then they're taking care to drive traffic to your site."